Perhaps in no other business has old-fashioned Yankee entrepreneurism meant more than in real estate. Throughout the decades, the Trumps and Zells have made headlines with their enormous real estate successes and risky, yet innovative approaches tomaking.
Innovation and entrepreneurism have always been part of the real estate professional's make up. But with today's onslaught of acquisitions and mergers, the introduction of new competition and emerging trends in technology, at no time is a spirit of entrepreneurism more important for the real estate manager than today.
The real estate entrepreneurs of today recognize, above all, that they must understand risk, how to measure it and weigh its consequences. The nature of risk and the art of choice lie at the core of successful real estate management.
The real estate marketplace today is filled with examples of managers who can dance to the rhythm of business that comes with change and growth. With calculated timing and intuition, they know what to do and when to do it. Through careful assessment, they are pursuing opportunities in non-traditional areas with a sense of entrepreneurship that can net them solid bottom-line results.
For example, they are developing alternative revenue sources from their properties using innovation and creative management. Some retail managers are gaining additional revenue through temporary seasonal or specialized tenants, carts, kiosks and vacant spaces within their malls, while others are netting bottom-line dollars through the leasing of incubator space and parking lot space for such uses as fireworks displays, Christmas tree lots and pumpkin sales.
Some managers of commercial buildings are finding they can create additional revenue through innovative advertising methods. By targeting hot Internet and computer companies that wish to lease advertising space on the side of a building or even the rooftop, substantial revenue can be generated.
Other residential management professionals are zeroing in on revenue opportunities that are a result of the latest technology. By offering tenants high-speed Internet access, cable, utility sign-ups, bottled water, banking, concierge and other services, a residential manager can often gain $200-$500 a month per unit in revenue.
Another way in which real estate managers are flexing their entrepreneurial arm today is through the management of non-traditional property types. To differentiate themselves from their competition, today's real estate management firms are finding that the management of specialty niche property types is where it's at.
For example, with a new focus on privatization and outsourcing, the Air Force and other branches of the service are offering the real estate management community a wealth of opportunities. Because military housing is less risky than market housing with a built-in clientele, the opportunities for real estate professionals to do business in this relatively untapped market are good ones. And, real estate managers, like those who are certified by the Institute of Real Estate Management (IREM[superscript]r), can apply their professional management skills in a way that benefits the users of this property type.
For Memphis-based Allen & O'Hara, Inc., AMO[superscript]r, focusing on developing a strong specialty niche with the college market has proved enormously successful. More than 60% of the firm's business is in managing suite-style apartment facilities for college students throughout the country.
Other real estate managers are applying their operations expertise to the management of parking facilities. Structured parking garages that are adjacent to an office or residential property, special event parking, and church parking facilities that are underused on weekdays all provide additional revenue opportunities for the real estate manager.
Medical buildings, church facilities and campuses, marinas and self-storage facilities offer additional opportunities for today's property management professional to apply their management expertise.
While the entrepreneurial nature of real estate managers is evident in the way they are actively seeking out alternative revenue sources and non-traditional property types, perhaps nowhere are their skills for innovation and visionary thinking more evident than in their expansion intomarkets. The Institute of Real Estate Management has long recognized the significance these markets represent for its property manager members. It has made great efforts to tap into these international markets and now boasts having 82 Certified Property Manager[superscript]r (CPM[superscript]r) members in 18 countries and IREM chapters in Poland and Russia. This past June, the Institute sponsored an International Forum bringing together delegates from ten different countries.
The spirit of innovation and entrepreneurism will continue to be alive and well in the real estate management industry. By carefully managing their risk and applying their management expertise in non-traditional ways, real estate managers will continue to dance to the rhythm of success.